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OFWAT Must Investigate Severn Trent Water Leakages

Wednesday, September 2, 2015

GMB Call On OFWAT To Investigate Severn Trent Water Leakages Amid Concerns That 500 Job Cuts Have Led To Depleted Water Stocks

STW increased the background consumption estimates by 20% in 12 months so OFWAT must investigate if this was to hide the true leakage position says GMB.

GMB, the union for water workers, is calling for OFWAT to investigate the water leakage data from Severn Trent Water (STW). 

GMB is concerned that that due to on-going failures to contain company leakage levels STW now finds itself with much depleted water stocks and fears for the coming winter period. See recent picture of STW reservoir illustrating this story on GMB website .

GMB considers that the failure to control leakages is linked to the shedding by new CEO, Liv Garfield of 500 key staff through redundancies during 2014/15 and introduction of a number of cost saving initiatives to increase returns to shareholders.

GMB want OFWAT to investigate why during the past year the allowance for background consumption of water per property has been increased from approx. 2.0 to 2.4 litres per property per hour. This change over the 4.3 million properties served by Severn Trent Water adds up to over 40 million litres per day (MLD).

GMB is asking OFWAT to investigate whether this change has been used to offset the true levels of leakage the company faces. OFWAT must investigate whether this change enabled STW to present a stable leakage position of 441ML/D to OFWAT thereby achieving the regulatory target of 453ML/D for 2014/15.

Gary Smith, GMB National Secretary for Utilities, said “GMB call on OFWAT to investigate possible inaccuracies in the leakage data supplied by STW for the last reporting year (2014/15).

STW increased the background consumption estimate per property per hour by up to 20% over a 12 month period. OFWAT must investigate if this was to hide the true leakage position

There is concerns that as far back as January senior management within STW could see they were going to fail the leakage target largely due to grossly failed change plans which reduced 500 key operational roles at a critical time.

GMB want OFWAT to investigate whether senior managers then began to seek to manipulate the backgound usage allowances and for this to be set against that otherwise attributed to be leakage. 

In 2008 the company was found guilty of supplying inaccurate data on leakages on 3 occasions between 2000 and 2002.  STW was also fined £35m for providing false information deliberately and offering customers a poor service.

The leakage figure is a major company Key Performance Indicator which contributes directly to the outturn of executive bonuses.

The new CEO is the same Liv Garfield who stood down from the board of Tesco. At Tesco profit figures were overstated the tune of over £240m.”


Contact: Gary Smith, GMB National Secretary on 07710 618909; Mark Bergman, 07957 266460 or Chris Needham 07966 327 974 or Colin Whyatt 07966 327971 or GMB Press Office 07921 289880


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